YOU CAN NOT DEPOSIT OLD 500-1000 NOTES IN RBI ? ONLY NRI OR PERSON OUTSIDE INDIA CAN

The President of India has approved the promulgation of the Specified Bank Notes (Cessation of Liabilities) Ordinance, 2016 today i.e. on 30th December, 2016.

The Ordinance is a follow-up to the decision taken by the Government of India to cancel the legal tender character of the existing series of banknotes, as on November 8, 2016, in the denominations of Rs.500 and Rs.1000 (Specified Bank Notes-SBNs) in circulation.

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The main objectives of the Ordinance are

(i) to provide clarity and finality to the liability of the Reserve Bank of India and the Government of India for the SBNs;

(ii) to provide an opportunity to those persons who were unable to deposit the SBNs within the time provided; and

(iii) to declare holding, transferring or receiving SBNs as illegal, with provisions for penalty for contravention of any of the provisions of the Ordinance.

Who can deposit Money with RBI

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As was notified on 8th November, 2016 those persons who were unable to exchange or deposit the SBNs in their bank accounts on or before 30th December, 2016 shall be given an opportunity to do so.

Accordingly, this facility has been granted to all Indian citizens who were outside India from 9th November, 2016 to 30thDecember, 2016 to tender these SBNs at the specified Issue Offices of RBI until 31st March, 2017.

For those citizens of India who are not resident in India, this facility would be available till June 30, 2017 in order to allow them adequate time to plan a visit as per their convenience.

However as per ordinance Govt may allow this facility to other persons also ,if deem fit.

Restriction on Bringing Back old notes in India

The above facility would be subject to the regulations of the notification “Foreign Exchange Management (Export and Import of Currency) Regulations, 2015. As per these Regulations bringing back such currency into the country is restricted to Rs.25,000/- per person. Separate FEMA provisions are applicable to persons in Nepal and Bhutan which would continue to apply.

At the time of return to India the number and denominations of the SBN will need to be declared to the Customs authorities at the airports and other entry points. Necessary form for such declaration will be given out by the CBEC. The details of the declaration and statements that are required to be submitted along with the SBNs at the time of deposit in RBI Issue Offices will be separately announced by RBI. Any false declaration will invite a fine of Rs. 50,000 or five times the amount of the face value of the SBN tendered, whichever is higher.

PENALTY

After the period of exchange is over, the liabilities of the Reserve Bank and the guarantee of the Central Government towards the Specified Bank Notes will stand extinguished. Further, to prevent any continued parallel transactions with the SBNs by unscrupulous elements, after this period, holding, transferring and receiving SBNs will attract a fine of Rs.10,000 or five times the amount of the face value of the SBN involved in the contravention, whichever is higher.